TIDMSML
RNS Number : 2214C
Strategic Minerals PLC
15 October 2020
Strategic Minerals plc
("Strategic Minerals" or the "Company")
Replacement RNS - September Quarter 2020 Magnetite Sales and
Cash Balances
The following announcement replaces the announcement released by
the Company at 7.00 a.m. on 12 October 2020 under RNS number 6875B.
In the sales update section, the previous announcement incorrectly
stated that sales volumes (tonnage) had increased 55% year on year,
rather than the correct increase being 46%. Also, in the same
section, the note to the table of results incorrectly stated that
US$0.75m forfeited by CV Investments LLC had been excluded from the
sales figues, when it has been included in the sales for the 12
months to September 2020. The amended text is shown below, all
other details remain unchanged.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
Strategic Minerals plc
("Strategic Minerals" or the "Company")
September Quarter 2020 Magnetite Sales and Cash Balances
Strong Sales Continue Despite Pandemic
Strategic Minerals plc (AIM: SML; USOTC: SMCDY), a profitable
producing mineral company , is pleased to provide the following
update on the Company's cash position and ore sales at the Cobre
magnetite operation in New Mexico, USA ("Cobre") for the quarter
ended 30 September 2020.
Highlights
-- Sustained solid sales growth continues organically.
-- 55% year on year rise in sales revenue at Cobre.
-- Uninterrupted operations continue at Cobre as a result of
effective zero contact on-site due to processes and policies
enacted in response to the Covid-19 pandemic.
-- Appointment of NRG Capital to develop options to advance the Redmoor tungsten and tin project.
-- Program for Environmental Protection and Rehabilitation
("PEPR") for the Paltridge North deposit at Leigh Creek Copper Mine
lodged.
-- Tax payments of over US$0.400m paid during the quarter, with all tax payments up to date.
-- Group cash balance of US$0.264m as at 30 September 2020.
Sales update: Cobre magnetite tailings operations
Sales volumes at Cobre continued to grow strongly in the
September 2020 quarter, up 46% year on year. Despite US activity
slowing in this quarter, sales remained robust and the positive
annual growth highlights the strength of demand being maintained
despite the Covid-19 Pandemic.
Sales comparisons on quarterly and annual periods to 30
September 2020, along with associated volume details, are shown in
the table below:
Tonnage Sales (US$'000)
--------------------------- ---------------- -------------
Year 3 months to 12 months to 3 months to 12 months to
Sept Sept Sept Sept
2020 10,987 60,250 632 3,741*
2019 12,704 41,245 756 2,407
2018 10,305 74,364 598 4,856
* For comparison purposes, it should be noted that in October
2019, sales figures included US$0.75m forfeited by CV Investments
LLC ("CV Investments").
Despite the continued suspension of mining activities at the
adjacent copper mine due to the Covid-19 pandemic, operations at
Cobre continue to operate under protocols established to ensure
contactless sales and have been successful in safeguarding both the
Company's employees and its clients.
The Company's wholly owned subsidiary, Southern Minerals Group
("SMG"), is in contact with the Receiver appointed by the US
Securities Exchange Commission in relation to CV Investments. It
continues to push its claim in relation to the previously notified
US $21.9m arbitration claim against CV Investments. The Company
will update the market with details as, and when, they are provided
by the Receiver.
Financials and Operations
At 30 September 2020, the Group's non-restricted cash balance
was US$0.264m (30 June 2020: US$0.533m). This represents a strong
underlying performance as, during the quarter, SMG paid over
US$400,000 in taxes. During the first half of 2020, SMG took
advantage of the US Government's offer to defer tax collections,
due to Covid-19, and the Company used this cashflow flexibility to
minimise the capital raise required in June 2020 to repay the loan
from New Age Exploration Limited related to the acquisition of the
Redmoor Project.
During the quarter, the Company appointed NRG Capital to provide
strategic and financial advice regarding advancing the Redmoor
tungsten and tin project. NRG is an independent advisory firm and
merchant bank focused on the global metals and energy
industries.
On the 6 October the Company announced a positive updated
scoping study undertaken by Wardell Armstong that reported improved
economics for the Redmoor tungsten and tin project.
The September quarter also saw the lodging of the PEPR for the
Paltridge North deposit at the Leigh Creek Copper Mine project. It
is expected that the PEPR approval should be forthcoming in the
December quarter 2020.
Commenting, John Peters, Managing Director of Strategic
Minerals, said:
"Sales at Cobre continue to show excellent annual growth
providing the Company the opportunity to repay outstanding
liabilities and benefit from surplus cash generated from
operations.
"Steps have been taken to move both the Leigh Creek and Redmoor
projects forward in a manner that avoids dilution at the parent
level. With copper prices around US$3lb and the recent emphasis on
the strategic nature of tungsten, the Board is confident that the
underlying value in its projects will be realized. "
For further information, please contact:
+61 (0) 414 727
Strategic Minerals plc 965
John Peters
Managing Director
Website: www.strategicminerals.net
Email: info@strategicminerals.net
Follow Strategic Minerals on:
Vox Markets: https://www.voxmarkets.co.uk/company/SML/
Twitter: @SML_Minerals
LinkedIn: https://www.linkedin.com/company/strategic-minerals-plc
Facebook: https://www.facebook.com/search/top/?q=strategic%20minerals%20plc
+44 (0) 20 3470
SP Angel Corporate Finance LLP 0470
Nominated Adviser and Broker
Matthew Johnson
Ewan Leggat
Charlie Bouverat
Notes to Editors
Strategic Minerals plc is an AIM-quoted, profitable operating
minerals company actively developing projects tailored to materials
expected to benefit from strong demand in the future. It has an
operation in the United States of America along with development
projects in the UK and Australia. The Company is focused on
utilising its operating cash flows, along with capital raisings, to
develop high quality projects aimed at supplying the metals and
minerals likely to be highly demanded in the future.
In September 2011, Strategic Minerals acquired the distribution
rights to the Cobre magnetite tailings dam project in New Mexico,
USA, a cash-generating asset, which it brought into production in
2012 and which continues to provide a revenue stream for the
Company. This operating revenue stream is utilised to cover company
overheads and invest in development projects orientated to
supplying the burgeoning electric vehicle/battery market.
In May 2016, the Company entered into an agreement with New Age
Exploration Limited and, in February 2017, acquired 50% of the
Redmoor Tin/Tungsten project in Cornwall, UK. The bulk of the funds
from the Company's investment were utilised to complete a drilling
programme that year. The drilling programme resulted in a
significant upgrade of the resource. This was followed in 2018 with
a 12-hole 2018 drilling programme has now been completed and the
resource update that resulted was announced in February 2019. In
March 2019, the Company entered into arrangements to acquire the
balance of the Redmoor Tin/Tungsten project which was settled on 24
July 2019 by way of a vendor loan which was fully repaid on 26 June
2020.
In March 2018, the Company completed the acquisition of the
Leigh Creek Copper Mine situated in the copper rich belt of South
Austra lia and brought the project temporarily into production in
April 2019. The project currently awaits clearance from the South
Australian Government of its lodged Program for Environmental
Protection and Rehabilitation (PEPR).
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END
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